Related Party Transaction Policy & Procedures
It is the policy of the Board of Directors of MillerKnoll, Inc. (the “Company”) that all Related Party Transactions, as that term is defined in this policy, shall be subject to approval or ratification in accordance with the procedures set forth below.
Standing Pre-Approval for Certain Related Party Transactions
The Governance and Corporate Responsibility Committee (the “Committee”) of the Company's Board of Directors has reviewed the Related Party Transactions described under “Standing Pre-Approval for Certain Related Party Transactions” below and has determined that each of the Related Party Transactions described in that section shall be deemed to be pre-approved or ratified, as applicable, by the Committee under the terms of this policy.
In connection with each regularly scheduled meeting of the Committee, a summary of any new Related Party Transaction deemed pre-approved pursuant to Items 1 or 5 under “Standing Pre-Approval for Certain Related Party Transactions” below shall be provided to the Committee for its review and awareness.
Committee Review of Other Related Party Transactions
The Committee shall review the material facts of all Related Party Transactions that are not described under “Standing Pre-Approval for Certain Related Party Transactions” below and shall either approve or disapprove of the entry into the Related Party Transaction. If advance Committee approval of any such Related Party Transaction is not practical, then the Related Party Transaction shall be considered and, if the Committee determines it to be appropriate, ratified by the Committee.
In determining whether to approve or ratify a Related Party Transaction, the Committee will take into account, among other factors it deems appropriate, (1) whether the Related Party Transaction is on terms no less favourable than terms generally available to an unaffiliated third party under the same or similar circumstances, and (2) the extent of the Related Party's interest in the transaction. If the Related Party Transaction involves a director or a nominee for director, the Committee should also consider whether the transaction will impact such individual's status as an independent director pursuant to applicable SEC and/or Nasdaq rules.
No director shall participate in any discussion or approval of a Related Party Transaction for which he or she or any of his or her Immediate Family Members is a Related Party, except that the director shall provide all material information concerning the Related Party Transaction to the Committee.
If a Related Party Transaction will be ongoing, the Committee may establish guidelines for the Company’s management to follow in its ongoing dealings with the Related Party. Thereafter, the Committee, on at least an annual basis, shall review and assess ongoing relationships with the Related Party to confirm they are in compliance with the Committee’s guidelines and that the Related Party Transaction remains appropriate.
A “Related Party Transaction” is any transaction, arrangement, or relationship or series of similar transactions, arrangements, or relationships (including any indebtedness or guarantee of indebtedness) in which:
1. the aggregate amount involved will or may be expected to exceed USD100,000 in any calendar year;
2. the Company is a participant (which shall be interpreted broadly to include transactions, arrangements, and relationships involving a subsidiary of the Company or from which the Company otherwise benefits); and
3. any Related Party has or will have a direct or indirect interest, other than solely as a result of being a director or a less than 10% beneficial owner of another entity.
A “Related Party” is any:
1. person who is or was (since the beginning of the last fiscal year for which the Company has filed a Form 10-K and proxy statement, even if they do not presently serve in that role) an executive officer, director, or nominee for election as a director of the Company;
2. greater than 5% beneficial owner of the Company’s common stock; or
3. Immediate Family Member of any of the foregoing.
"Immediate Family Member" means a person’s spouse, parents, stepparents, children, stepchildren, siblings, mothers- and fathers-in-law, sons- and daughters-in-law, and brothers- and sisters-in-law and anyone residing in such person’s home (other than a tenant or employee).
Standing Pre-Approval for Certain Related Party Transactions
The Committee has reviewed the types of Related Party Transactions described below and determined that each of the following Related Party Transactions shall be deemed to be pre-approved by the Committee, even if the aggregate amount involved will exceed USD100,000:
1. Certain Transactions with Other Companies. Any transaction with another company at which a Related Party's only relationship is as an employee (other than an executive officer), director, or beneficial owner of less than 10% of that company’s shares, if the aggregate amount involved does not exceed the greater of USD1,000,000, or 2% of that company’s total annual revenues.
2. Employment of Executive Officers. Any employment by the Company of an executive officer of the Company if (a) the related compensation is required to be reported in the Company’s proxy statement under applicable SEC rules (generally applicable to “named executive officers”), or (b) the executive officer is not an immediate family member of another executive officer or director of the Company, the related compensation would be reported in the Company’s proxy statement under applicable SEC rules if the executive officer was a “named executive officer,” and the Company’s Compensation Committee approved (or recommended that the Board approve) such compensation.
3. Director Compensation. Any compensation paid to a director if the compensation is required to be reported in the Company’s proxy statement under applicable SEC rules.
4. Transactions in Which All Shareholders Receive Proportional Benefits. Any transaction in which the Related Party's interest arises solely from the ownership of the Company’s common stock and all holders of the Company’s common stock received the same benefit on a pro rata basis (e.g. dividends).
5. Transactions Involving Competitive Bids. Any transaction involving a Related Party where the rates or charges involved are determined by competitive bids.
6. Regulated Transactions. Any transaction with a Related Party involving the rendering of services as a common or contract carrier, or public utility, at rates or charges fixed in conformity with law or governmental authority.
Updated: July 2022